Pricing of Services | The Taj Mahal Palace

Presented By

Maneet Kumar

Mani Shankar Sonkushre

Man Mohan Anand

Arti Kumari

Debarati Sen Gupta

Monalisa Ghosh

The Indian Hotels Company (IHC) is the parent company of Taj Hotels Resorts and Palaces.

It was founded by Jamshed Ji N. Tata on December16, 1903.

Currently the Taj Hotels Resorts and Palaces comprises 57 hotels at 40 locations across India

Additional 18 hotels are also being operated around the globe.

During fiscal year 2006, the total number of hotels owned or managed by the Company was 75

Introduction – Hotel Taj Mahal Palace

Business Services

• Wireless Internet Access

• Color Copier

• In-house Video-Conferencing

• Laptop Computers on Hire

• Translation / Interpretation Services

• Secretarial Services

Leisure and Other Services

• 24-hour in-Room Dining

• Baby Sitting

• Car Hire Service

• Currency Exchange

• House Doctor

• Yacht

Services at Taj Mahal Palace

It is a price point in memory for a good or services and generally consists of price last paid , the price frequently paid or the average of all prices customer have paid for similar offering.

It differs from actual price due to :

• Service Variability.

• Providers are unable to estimate the price.

• Individual customer needs vary.

• Collection of price is overwhelming.

• Prices are not visible

Reference Prices

• Time Cost

• Search Cost

• Convenience Cost

• Psychological Cost

Nonmonetary Costs Considered in Pricing

Is Price an Indicator of Service Quality?

Cost Based

Competition Based

Demand Based

Approaches to Pricing of Services

Fixe

d C

ost

All Real asset Cost

Depreciation

Cost of Operation

Cost of labour

Cost of Sales and marketing

Var

iab

le c

ost

In Room Amenities

Cleaning and House keeping

Distribution Cost

Travel Agent Commission Cost

Special Application e.g. Spa

Cost Based

Competitive Pricing is the discipline that strategically and tactically defines the price offered in comparison to the market. Competitors of Taj are Marriot group ,The Oberoi group ,Grand Hyatt group, ITC group , The Lalit Hotel group, Leela group.

Category Taj Oberoi Leela

Standard Room

Rs. 13,500

Rs. 13,299

Rs. 12,978

Luxury Room

Rs. 21,278

Rs. 21,675

Rs. 20,287

Competition Based

Taj Mahal Palace & Tower, Mumbai

Leela Palace, Bangalore

Trident Hilton, Gurgaon

Oberoi Udaivilas, Udaipur

Leela Kempinski, Mumbai

Rambagh Palace Hotel, Jaipur

The Four Seasons, Mumbai

Imperial Hotel, New Delhi

Taj Coromandel, Chennai

Sheraton Maurya, New Delhi

Source - http://www.theindiastreet.com/2007/08/top-ten-10-business-hotels-in-

india.html

Top 10 Hotels in Terms of Business

Demand Based pricing also known as Dynamic pricing is all about tailoring their pricing according the current supply and demand

You expect to pay more for a hotel when a city is full of conventioneers and to pay less at a resort during the off season.

Demand changes constantly based on economic conditions and other external factors. They offer wide ranges of products and services that customers may value or devalue according to whim and fashion.

Demand Based Pricing

Price Elasticity

Value

Low Price

Everything I want in a

service

Quality I get for the price I pay

All that I get for all that I give

Perceived Value

Value is Low Price

• Discounting

• Odd Pricing

• Synchro-Pricing

• Penetrating Pricing

Everything I want in a service

• Prestige Pricing

• Skimming Pricing

Quality I get for the Price I pay

• Value Pricing

• Market Segmentation Pricing

All I get for all that I give

• Price Framing

• Price Bundling

• Complementary Pricing

• Result- Based Pricing

Perceived Values (Contd.)

Thank You